North American Free Trade Agreement Renegotiating Public Comments

The United States Industrial Fabrics Institute (USIFI) and the Narrow Fabrics Institute (NFI), both divisions of the Industrial Fabrics Association International IFAI) have submitted their
comments regarding US President Donald Trump's intent to open the North American Free Trade Agreement for modernization in today's marketplace. Other trade associations -- including the National
Council of Textile Organizations -- and industry companies have also submitted the public comments regarding NAFTA.

The following is the USIFI/NFI public comment filed on June 12 with the US Trade Representatives Office.

Public Comments of the U.S. Textile Industry Regarding Docket USTR–2017–0006, Negotiating Objectives Regarding Modernization of North American Free Trade Agreement with Canada and Mexico
(NAFTA Negotiations)

June 12, 2017

These comments are provided on behalf of the United States Industrial Fabrics Institute (USIFI) and Narrow Fabrics Institute (NFI) in response to the Federal Register request for public comments
found at 82 FR 23699 and dated May 23, 2017 (USTR–2017–0006).

The United States Industrial Fabrics Institute (USIFI) is a division of the Industrial Fabrics

products, advanced materials, and components used to support a variety of high-value-added and sophisticated industries. These include the aerospace, automotive, construction, marine, medical,
military and safety/protective gear sectors among others. USIFI currently has 75 member companies, and its headquarters are in Roseville, MN. http://usindustrialbabrics.ifai.com/

The Narrow Fabrics Institute (NFI) is a division of the Industrial Fabrics Association International (IFAI) whose mission is to work on common interests and issues in the narrow fabrics industry.
Narrow fabrics are defined as textiles that are no more than 12 inches (300mm) in width and are made by weaving, knitting or braiding fibers or yarns with an edge to prevent unraveling. The primary
product areas of NFI’s 57 member companies include automotive, military, safety, transportation, medical, and other (aerospace, industrial, pet, recreational, electronics). The North America market
is estimated at over $335 million in annual sales. http://narrowfabrics.ifai.com/

USIFI and NFI agree that NAFTA is due for comprehensive review to determine whether it can be improved. However, noting that U.S. textile and apparel exports to NAFTA totaled $11.1 billion in 2016
and the high level of integration that exists today in the North American textile supply chain, USIFI and NFI oppose a wholesale cancelation of NAFTA.

Instead, USIFI and NFI support an improvement along the lines of:

Committing greater resources and focus to customs enforcement

During the past 30 years, there has been a systematic deemphasis of commercial fraud

enforcement at U.S. Customs and Border Protection (CBP). CBP suffers from both a lack of resources and focus, especially noting the uptick in the number of trade agreements and

overall trade flows during this timeframe. Consequently, the benefits of these agreements

have been siphoned off by third-party countries and importers willing and able to

circumvent U.S. trade laws and agreements.

USIFI and NFI strongly support the adoption of a new mentality that places an increased,

but proper, emphasis on customs enforcement of NAFTA and other FTAs. We encourage

the Trump administration and Congress to tangibly demonstrate that new approach by

increasing resources at CBP to enable more effective enforcement of U.S. trade laws and

duty assessments.

USIFI and NFI also note that more effective trade enforcement will not only pay for itself,

but also generate new revenues that could then be used to promote trade facilitation

through the rebuilding and expansion of America’s infrastructure.

Eliminating exceptions to yarn forward in the NAFTA rule of origin

The standard rule of origin for textiles in nearly all U.S. FTAs is the yarn-forward rule, which requires yarn and everything following the yarn stage to be done in the
FTA region. Yarn forward was originally devised under NAFTA and is the accepted rule of origin for the domestic textile industry because it reserves key benefits for manufacturers within the
signatory countries. A yarn-forward concept is also markedly easier to enforce versus a value-added rule of origin.

Although most U.S. FTAs are built on yarn forward as the basic structure, exceptions to the basic rule exist in many agreements that shift business away from U.S.
producers to FTA parties, namely China. These yarn-forward loopholes take many forms, with the most egregious being TPLs. TPLs allow for a specific quantity products to be shipped duty free among
free trade partner countries even though the components within the product are sourced from countries that are not signatories to the agreement.

Under NAFTA, Mexico is permitted ship up to the equivalent of 24 million square meters (SME) of certain fabrics and made-up textile articles, including man-made fiber
industrial products, annually to the U.S. duty free. Canada has a 72 million SME TPL for this category of articles. There are three additional TPLs for cotton and man-made fiber yarns, cotton and
man-made fiber apparel, and wool apparel. These and other loopholes and should be eliminated in any renegotiation.

Closing the loophole that dilutes the Kissell Amendment

The Kissell Amendment, 6 USC 453b, is a Berry Amendment-like buy American law for textiles that applies to the Department of Homeland Security (DHS). In practice,
however, DHS only applies Kissell to purchases by the Coast Guard and Transportation Security Administration (TSA) because of U.S. commitments made under the WTO’s Revised Agreement on Government
Procurement (GPA).

With respect to its application to TSA, Kissell has further been diluted. This is because the U.S. government failed to notify Mexico and Canada under NAFTA, as well as
Chile under the Chilean FTA, that the United States was reserving TSA from the GPA when TSA was created. Thus, the United States has taken the position that those countries are acceptable as U.S.
sources under Kissell. This oversight should be rectified in any NAFTA renegotiation.

Thank you for your consideration of our views, and we look forward to working with the Trump administration in the NAFTA modernization effort.

Is Saving the US Navy's Peacoat a Matter of National Security?

Since last August, the US Navy has been planning to phase out its iconic traditional wool peacoat in favor of a less expensive, synthetic cold weather parka which is lighter in weight and more
versatile in types of inclement weather. It actually replaces two types of coats and the seabag the wool coat is stored.

The wool coat, however, has some powerful friends in the US Congress. Companies such as Northwest Woolen Mills in Woonsocket, R.I. and Sterlingware in Boston, Mass. Altogether, the supply chain
involved in the manufacture of these woolen peacoats -- including sheep farmers -- is estimated to account for 400 jobs in the Northeast. Add to the drama that the new parka, made by the long-time
military supplier Propper, is expected to be manufactured in Puerto Rico, a perceived feeling the new coat will be made by non-American workers. Read more...

Steve Warner

Publisher

June 29. 2017

BeaverLake6 Report at Techtextil North America

Wisconsin Contract Sewer Wins the Amazon Echo at Techtextil North America. Thanks for all who stopped by the BeaverLake6 Report booth at the Techtextil North
America show last week in Chicago, Ill., USA. I truly appreciated talking with you about your company and the industry. For those of you who entered the drawing, the winner of the Amazon Echo
was Jim Herman, owner of Wisconsew Inc., a contract sewing company located in Shawano, Wis., USA. Special thanks to Eduardo Castañer, publisher and general manager of Davison Publishing, for helping draw the lucky card. Posted June 24,
2017

President of American Fiber Manufacturers Association Passes. The American Fiber Manufacturers Association (AFMA) has reported Paul
T. O'Day, president and counsel of the organization, passed away June 1. He was 82 and died peacefully at his home.

In a statement issued today, the organization said: "Mr. O'Day was appointed President of the Association in 1984. He was fiercely dedicated to the industry he loved
for 33 years. A true gentleman and powerful intellect, Paul O'Day led the Association with a sophisticated wit and charm."

Posted June 5, 2017

Mars Prototype Shelter by MDT-tex

Imagination on Display in Frankfurt. It was known going into the Techtextil and Texprocess shows last week that tthere would be a record number of exhibitors and, further,
there was so much attendance the last time in 2015 that the organizer decided to expand the length of the shows to 4 days in 2017. Thus so, it was no real surprise that the final report reveals more
than 47,500 visitors came (an increase of 14% over 2015) from 114 countries. According to a poll taken of visitors, 42% felt the economic climate could be consider "good" (compared to only 32% in
2015). The next Techtextil and Texprocess shows in Frankfurt will be held May 14-17, 2019. Click here for more
insight into the shows as well as the official final report from Messe Frankfurt. Posted May 17, 2017

Secretary Wilbur Ross

US Department of Commerce Leaves Textile Industry Out of Trade Agreement Priorities. Since President Donald Trump took office there has been much talk about
the ambitious "America First" trade priorities including pulling out of the Trans-Pacific Partnership agreement, the planned renegotiating of the North American Free Trade Agreement, and even
revisiting the textile industry's disastrous US-Korea Free Trade Agreement.

So, it would seem logical the US textile industry would be a priority in the changes in all these trade talks. Apparently not.

Last week Department of Commerce Secretary Wilbur Ross, no stranger to the textile industry, named 6 core industries for its trade agenda -- steel, aluminum, vehicles, aircraft,
shipbuilding and semiconductors. Noticeably missing was the consideration of textiles as a vital core industry for inclusion in these trade talks. Despite back-patting about the optimism of
working with the new Trump Administration when the National Council of Textile Organizations (NCTO) met in Washington recently for its annual meeting, there seems to be a long road to hoe
before textiles is taken seriously by the Federal government for its importance to the US economy. Again, I ask: Who will take the lead in developing a US textile industry vision?

Steve Warner

Publisher

Posted April 26, 2017

Trans-Pacific Partnership Withdrawal Impact

Bud Weisbart, MFC, IFM

"The United States is looked upon by those with whom I inter-related as less and less relevant as
an economic force, and has become simply the market into which those within and outside of the Trans-Pacific Partnership (TPP) countries would sell their goods and services with little concern for
reciprocity. To me, our immediate withdrawal from TPP after the election only compounds this situation." Click here to read the entire posting by Bud Weisbart, a small business owner and frequent contributor to BeaverLake6 Report. Posted March 29,
2017

President Trump's Reveals 2017 Trade Policy Agenda

The Office of the U.S. Trade Representative (USTR) has
released President Trump's 2017 Trade Policy Agenda. The document, officially called2017 Trade Policy Agenda and 2016 Annual Report of the President of the United States on
the Trade Agreements Program,outlines the new Administration’s four trade priorities:

Defending the US National Sovereignty over Trade Policy

Strictly Enforcing US Trade Laws

Using Leverage to Open Foreign Markets

Negotiating New and Better Trade Deals

​BeaverLake6 Report has created a special page within this website and placed the
first chapter of the 336-page document which summarizes the policy. Clickhereto read it. Posted March 2, 2017

What's the NCTO Game Plan for the Post-TPP Era?

Back on March 24, 2016, I was one of the first to predict the Trans-Pacific Partnership (TPP) agreement was a dead deal. In fact, I said that I wouldn’t be surprised that, if Donald
Trump became President, the agreement is shredded on day one of his new administration. Well, I was off by three days. Yesterday, President Trump signed an Executive Order, officially
withdrawing the United States from the TPP agreement. Now the question is can the National Council of Textile Organizations put together a comprehensive plan for the domestic textile industry in a
post-TPP era? Click here to read the rest. Posted January 25, 2017

Steady Growth Prospects for Expanding Specialty Geosynthetics

There are literally dozens of market reports for the many market sections and subsections within the technical textiles industry. In 2017, BeaverLake6 Report will be introducing a few of
these reports to our viewers. The first report being features is The Future of Spcialty Geosynthetics to 2021. It was developed by Smithers Apex, a market research firm based in the United
Kingdom.

In exchange for the promotion, Smithers Apex agreed to write an exclusive expanded executive summary of the market report for our readers. Click here to view the market summary. Posted January 9, 2017

2016 China Textile Innovation Conference Explores the Roads to a Textile Power

Sun Ruizhe

2016 China Textile Innovation Conference, as an annual summit of industry innovation, was held in Beijing on December
12th, 2016. The conference, themed on “New Opportunity, New Advantages, New Vitality” – Stepping Towards a Textile Power, comprehensively summarized the industry innovation achievements and
explored the new advantages in development in order to grasp the strategic opportunity of the new round of industrial changes. BeaverLake6 Report is pleased to present a report on the
conference via our partnership with China Textile magazine. Please click here. Posted December 21,
2016

In My Opinion

Re-Shoring: Good for the Goose is Not Good for the Gander?

Domestic PFD Manufacturer's Application for FTZ Additional Production Authority Riles Textile Industry Trade
Associations. There is a nasty fight taking place these past few months behind the closed doors of Room 48019 at the Herbert C. Hoover
Building in Washington, D.C. The room is the office of the Foreign-Trade Zones Board. The fight pits domestic technical textile industry suppliers and a coalition of textile-trade associations
against a fairly large domestic end-product cut-and-sew manufacturer. Clickhereto read the story.

Steve Warner

Publisher

Jon Klein's Outlook

I am pleased to announce BeaverLake6 Report has added a new column called "Jon Klein's Outlook." Jon Klein is the Business Development Leader at PrimaLoft® Aerogel insulation. With over 20 years in the industry, Mr. Klein
has extensive experience in the textiles, apparel and footwear industry. Mr. Klein is a
frequent contributor of short articles on LinkedIn, the world's largest business network, writing about the various market segments of the technical textiles. This column covers his LinkedIn
postings. Pleaseclickhere to go to his column.

Steve Warner, Publisher

June 27, 2016

US International Trade Administration Publishes New Top Market Report for Technical Textiles

Industry Market Report Available. What impact has the sale of decline of military products purchases have on government shelter
fabricators? What is the outlook on textiles going into the automotive industry? What are three issues that can negatively impact the growth of the protective clothing market segment?

You can find the answers to all these questions in the 2016 State of the U.S. Technical Textiles Industry report published
in Textile World magazine. Part One of the report is in the March/April issue and Part Two will be in the May/June issue.

Media Partners

In My Opinion

In 2015, I posted more than 425 items of interest for our industry on theBeaverLake6 Reportwebsite. In reviewing it all last week, it got me to thinking about putting together a list of
influential events, news and trends that I observed during the past year. I have focused primarily on the US marketplace but each of “the things that mattered” to me has global
implications.

So, here go my thoughts in no particular order of importance. Let me know if you agree or if I have missed some. Clickhere to read the list.

Steve Warner

Publisher

Posted January 17, 2016

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Director

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